When someone hears the word crowdfunding, they typically think of a Kickstarter campaign for medical bills or pre-ordering a trinket that may or may not ever arrive.
Now, everyone can invest in the future of business.
Timing is critical
Startups in the equity crowdfunding space tend to be quite early-stage, and therefore carry a higher element of risk. The privilege to invest in young companies was the exclusive playing field of accredited investors, aka the rich. Since most Americans fall into the non-accredited investor category, they were locked out of investing in these types of opportunities – until equity crowdfunding.
In fact, America’s biggest equity crowdfunding platforms have been busy raising money. WeFunder helped raise $85 million and StartEngine has been responsible for funding over 250 early-stage ventures. The American equity crowdfunding platforms are certainly making their mark on the industry – it’s an exciting time.
Entrepreneurs with a focus on values, do not typically tend to get funded, which encourages and subsequently rewards the profit-over-people business model that’s attractive to banks (of course). This happens because of the shift in focus from pleasing the customer, to creating profit for the shareholder. Therefore, it’s no surprise that people in communities are responding positively to funding and supporting the startups and entrepreneurs who create the very goods and services they’re consuming. By investing in their communities, people are investing in themselves; not a bump in stock value for a millionaire living in a penthouse. It’s a mutual beneficial ecosystem that happily maintains an unwavering commitment to quality and customer satisfaction.
One entrepreneur who used equity crowdfunding to launch their business describes investors as people “who won’t ask the company to change its business model or sacrifice its mission to make more money.”